Fair price: research outside marketing

Abstract

PurposeThe purpose of this paper is to summarize the current research in disciplines outside marketing that applies to price fairness: research by behavioral economists, primate behavior researchers and social neuroscientists.Design/methodology/approachThe approach is descriptive, summarizing the extensive research into fairness being done in disciplines other than marketing.FindingsResearch outside marketing indicates that a fair price is a preference. It has social utility that is independent of the economic utility of a low price. Consumers can actually harm themselves to punish what they perceive to be an unfair price. Conversely, a fair price triggers the reward center of the mind, stimulating happiness. The research also indicates that the response to a fair or unfair price is emotional: fast and automatic. The strength of that emotional response to unfairness varies across people. However, despite the variation in reactions, to ignore the concern for fairness is to miss a major motivation in economic decision making.Originality/valueThe fairness research in other disciplines both supports and informs the marketing research into what constitutes a fair price and how people respond to price (un)fairness.